Correlation Between Petroleo Brasileiro and Marshall Machines
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By analyzing existing cross correlation between Petroleo Brasileiro Petrobras and Marshall Machines Limited, you can compare the effects of market volatilities on Petroleo Brasileiro and Marshall Machines and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Petroleo Brasileiro with a short position of Marshall Machines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and Marshall Machines.
Diversification Opportunities for Petroleo Brasileiro and Marshall Machines
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Petroleo and Marshall is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and Marshall Machines Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marshall Machines and Petroleo Brasileiro is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Petroleo Brasileiro Petrobras are associated (or correlated) with Marshall Machines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marshall Machines has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and Marshall Machines go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and Marshall Machines
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 0.62 times more return on investment than Marshall Machines. However, Petroleo Brasileiro Petrobras is 1.62 times less risky than Marshall Machines. It trades about 0.07 of its potential returns per unit of risk. Marshall Machines Limited is currently generating about 0.01 per unit of risk. If you would invest 722.00 in Petroleo Brasileiro Petrobras on September 19, 2024 and sell it today you would earn a total of 562.00 from holding Petroleo Brasileiro Petrobras or generate 77.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.78% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. Marshall Machines Limited
Performance |
| Timeline |
| Petroleo Brasileiro |
| Marshall Machines |
Petroleo Brasileiro and Marshall Machines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and Marshall Machines
The main advantage of trading using opposite Petroleo Brasileiro and Marshall Machines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, Marshall Machines can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Marshall Machines will offset losses from the drop in Marshall Machines' long position.| Petroleo Brasileiro vs. Ecopetrol SA ADR | Petroleo Brasileiro vs. Equinor ASA ADR | Petroleo Brasileiro vs. Eni SpA ADR | Petroleo Brasileiro vs. Cenovus Energy |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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